[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

December 5, 2012 - 1:59 pm

I have a similar question with regards to the original post and thought I'd chuck it in here instead of starting a new topic.

My question,

Assuming they owe around $170000 ( a guess), i'm also guessing that the property would be valued at around $400,000, would it be possible to purchase the property from them for around 280000, 290000. giving them enough money to pay out their loan and also make a nice profit. While also giving me equity once getting the property valued. I would then in turn rent it out to them, but at a rate that would cover IO repayments. saving them more money on what they were paying and giving them the chance to enjoy life a little more. Aswell as making it a at worst neutrally geared IP.

Obviously the figures i've stated are just a guess, but the main question would be, are there any tax/legal no-nos about buying below value and both profiting, parents debt free and extra cash, me my first IP with a fair bit of equity good to go?

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

November 26, 2012 - 10:10 pm

I'm looking at purchasing my first ip next year. Is a depreciation schedule worked out over a whole financial year or based on the time you've had it for.

i.e. If i settled on a property on say June 30th vs July 1st is there going to be a difference in the depreciation schedule, Would it be more beneficial to settle on 1 vs the other?

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

November 14, 2012 - 7:03 pm

Thanks Shape and Jamie,

Hopefully all questions i have on here can be answered as easily as that.

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

April 6, 2010 - 10:22 am

none of the loans have any penalties for being payed out earlier, and yeah my plan is to put the $750 f/n towards savings once all the debts are gone, possibly more as i have another interest free loan where $155 comes out which is repayed in early december.  i also have $50 f/n going into another account which i reguarily forget about lol which i use as my savings.

Like you said i'm not looking at purchasing anything sooner then atleast probably july/august next year as i simply won't have the funds available.

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

April 6, 2010 - 6:30 am

Just thought i would give everyone an update as to where i'm at with getting rid of these debts. I'm also yet to do my tax return for last year.

what i started with.                                                           what i have now.
    27/01/2010                                                                         06/04/2010

      $17100                                                                                 $12354

$8200 @ 10.5%                                                                $7700 @ 10.5%
$6300 @ 16.15%                                                              $4066 @ 16.15% 
$1000 @ 13.3%                                                                  $588 @ 13.3%
$1600 @ 11.99%

i'm happy with the progress i'm making and it was good to get rid of one of the loans this afternoon, although paying the ~$1200 off of the 16.15% loan would of been better financially it feels better only having 3 debts instead of 4 now

the loan that i payed off was done so 23 months ahead of schedule and because i had insurance the bank actually pays me $19.38

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

February 18, 2010 - 7:50 am

Thanks for explaining how the loans work.

I've got steve's 0 to 260+ in 7 years book now and am currently about half way through, i've got a DHA property investing seminar on 24th feb, Steve's seminar in sydney on the 24th march. So the educating is going in the right direction.
However i think i may have taken a step backwards with the paying off my debts. I'm not sure if anyone knows about banks lending criteria?

I saw the add for the citibank gold credit card, offering 2.9% for 12months. I was going to use this to consolidate my credit card and personal loans, saving myself ~$900 on interest. unfortuneatley i was declined.

 During the application interview over the phone. I was asked how much i earned which is about $76000, after tax and super and repayments on a intrest free loan through the navy, ~$53000.

$2029 p/fnight.

expenses. rent $500
debts $750.
minimum repayents $330

i told the person on the phone that i was paying, $1500 a month off of my loans. should i of just said that i was paying off of the minmium repayments. i told the guy on the phone that i was paying off more then double the repayments. did i shoot myself in getting approved for the credit card, or could i have a bad credit rating? i thought i would of been ok with my figures considering the loans i'm paying off would be going across to the citibank credit card?

will i have a 'black mark' against me now that the credit card was declined. should i try and apply for another credit card with the low interest rate for a 12month period, i've seen a few with 1.99%-4.9% for 12 months. compared to the best personal loan i could find 12.9%?
should i apply for the citibank gold card again but only use the minimum repayments when asked for my expenses?

thanks in advance.

 Todd Giles

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

February 4, 2010 - 6:30 am

Sonya,

Would you or someone else be able to explain the whole not paying off the principal amount, sorry not real savvy with the terminology.

thanks.

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

February 2, 2010 - 6:02 am

Has anyone studdied any courses at TAFE or anywhere else to help them with education about property investing?

Turns out i may of just taken the interest rates as stated on the NEwcastle Permanent website, rang again this afternoon, was told 12.9% not exactly what i was hoping for lol. Will continue the search for a low interest rate personal loan to consolidate.

As it stands each fortnight , starting this thursday (4Feb10) i have coming off each debt.

 $6300 @ 16.15% – $500
$1000 @ 13.3% – $50
$1600 @ 11.99% -$80
$8200 @ 10.5% – $153

i'm looking forward to being debt free already , the sooner it happens, the sooner i can start property investing.

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

January 30, 2010 - 10:26 pm

Thanks Sonya,

What affect would having the extra payments just being seen as payments 'in advance' do, am i paying interest on more?

I think this may be the case for my loans?
 
From my internet statement for the $6300 @ 16.15% it says.

Current balance:  -$6300
Remaining term: 33 months
Repayment:  $115.67
Next Repayment Due:  18  Feb 2010 (My next pay is the 4 Feb 2010)
In Advance: $217.45
Available for Redraw: $101.78

Just remembered I still have to get around to doing last years tax return which should help in eliminating my debt. woops haha.

[Todd GilesMember@todd-gilesJoin Date: 2010Post Count: 13]

January 30, 2010 - 12:48 pm

Thanks everyone for the advice and information.

At the moment i think i'm going to go with what most people have said and start with paying off the $6300 at 16.15% first. and then work my way down the percentages.

I've been in contact with my other bank (Newcastle Permanent Building Society) in regards to refinancing through a secured personal loan, with an interest rate of 9.76% comparisson. It turns out my bike wasn't worth enough to use as security, and my car was too old to use as security. I am considering asking my father to go on the loan with his mortage as security to enable me to access the lower interest rate, Just trying to gauge people thoughts?

For IPInvestor the minimum repayments for each debt are :-

$6300, variable @ 16.15% – $115.67 Fortnightly
$1000 variable @ 13.3% – Not sure on the internet banking it has $20 a month.
$1600 fixed @ 11.99% – $79.63 Fortnightly
$8200 variable @ 10.5% – $103.06 Fortnightly

I've set aside $750 a fortnight towards paying off the debts.
 
My plan for this year as people have suggested, is to use this year as debt elimination and education in regards to Property Investing aswell as just a self improvment year alround. I'm looking at completing a Cert IV in real estate to help me with understanding some of the behind the scenes aspects of buying, selling property. Has anyone done any TAFE or other courses they could reccomend?

Cheers again everyone for the help.

Regards,

Todd Giles